tried a more complex test using some databases, all working fine! for anyone trying to deploy their first rails app on eukhost take note of my steps above...
dont forget when using databases on eukhost that your account name gets added to the start of your database name and underscores are removed. eg:
"myapp_development" becomes "username_myappdevelopment"
so remember to update your config/database.yml to include the new database names (once you've set them up using SSH or cpanel) and change the username from root (or whatever you develop with locally) to your eukhost username you have set up on mysql. I know I've just whizzed over some steps there, but I found it pretty simple from here on in and I expect you will do too